Press Release
August 2, 2005
For Immediate Release
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For Information Contact:
NCRIC Group, Inc.:
Eric R. Anderson, Senior Vice President, Corporate Communications and
Investor Relations - 800.613.3615 or 202.969.3102
ProAssurance Corporation:
Frank B. O'Neil, Senior Vice President, Corporate Communications and
Investor Relations - 800.282.6242 or 205.877.4461
NCRIC GROUP, INC. SHAREHOLDERS APPROVE MERGER INTO PROASSURANCE CORPORATION
Washington, DC and Birmingham, AL - August 2, 2005 - NCRIC Group, Inc. (NASDAQ:
NCRI) and ProAssurance Corporation (NYSE: PRA) jointly announced that NCRIC's
shareholders have approved NCRIC's merger into ProAssurance. The approval came
at today's special meeting of shareholders in which an overwhelming majority of
votes cast were in favor of the transaction.
NCRIC's merger into ProAssurance is expected to be declared effective upon the
close of business on August 3, 2005. Each share of NCRIC common stock will be
converted into 0.25 shares of ProAssurance common stock automatically at the
effective time of the merger. NCRIC expects to delist its stock on NASDAQ at
that time. Holders of NCRIC shares may begin trading their converted shares as
ProAssurance common stock on the NYSE on August 4, 2005, the day following the
expected effective time of the merger. Record holders of NCRIC common stock will
receive instructions for exchanging their certificates of NCRIC common stock for
certificates of ProAssurance common stock within the next few days.
ProAssurance's Chairman and CEO, A. Derrill Crowe, M.D., stated, "The NCRIC
transaction is an important step for us because of its strategic fit in our
organization. NCRIC is a well-established organization that offers us
significant penetration in Washington, D.C., Delaware and Virginia, and brings
an established core of insurance professionals into our company. As we complete
this transaction, we believe ProAssurance is stronger and better positioned to
serve our customers than ever before."
With the completion of the transaction, ProAssurance will have $3.3 billion in
assets and will serve policyholders in 22 states and the District of Columbia.
NCRIC, Inc., NCRIC Group's insurance subsidiary, will continue to service the
mid-Atlantic region as a wholly owned subsidiary of ProAssurance Corporation and
will operate out of NCRIC's Washington, D.C. office.
R. Ray Pate, Jr., President and CEO of NCRIC Group, Inc., added, "We are pleased
with the value this transaction has brought to our shareholders, and we're
excited about the opportunities for us to better serve our policyholders as part
of a larger, stronger organization."
About NCRIC Group, Inc.
NCRIC Group, Inc. (NCRIC) is a healthcare financial services organization that
assists individual physicians and groups of physicians in managing their
practices by providing medical professional liability insurance, practice
management and financial services, and employee benefits plan design and pension
administration. In addition to its headquarters in Washington, D.C., NCRIC has
offices in Wilmington, Delaware; Greensboro, North Carolina; Richmond and
Lynchburg, Virginia; and Charleston, West Virginia. NCRIC provides services to
more than 4,600 physician clients.
About ProAssurance
ProAssurance is a specialty insurer with more than $3.2 billion in assets and
$790 million in gross written premiums in 2004. As the nation's fourth largest
writer of medical professional liability insurance, ProAssurance's principal
professional liability subsidiaries, The Medical Assurance Company, Inc.,
ProNational Insurance Company, and Red Mountain Casualty Insurance Company,
Inc., are recognized leaders in developing solutions which serve the needs of
the evolving healthcare industry. ProAssurance is the tenth largest writer of
personal auto coverage in Michigan through its subsidiary, MEEMIC Insurance
Company.
A.M. Best assigns a rating of "A-" (Excellent) to ProAssurance and its principal
professional liability subsidiaries and MEEMIC; Standard & Poor's assigns its
principal professional liability carriers a rating of "A-" ("Strong"); and Fitch
assigns a rating of "A-" to its subsidiaries, The Medical Assurance Company,
ProNational Insurance Company and MEEMIC Insurance Company.
Caution Regarding Forward-Looking Statements
This news release contains historical information as well as forward-looking
statements that are based upon our estimates and anticipation of future events
that
are subject to certain risks and uncertainties that could cause actual results
to vary materially from the expected results described in the forward-looking
statements. The words "anticipate," "believe," "estimate," "expect," "hopeful,"
"intend," "may," "optimistic," "preliminary," "project," "should," "will," and
similar expressions are intended to identify these forward-looking statements.
There are numerous important factors that could cause our actual results to
differ materially from those in the forward-looking statements. Thus, sentences
and phrases that we use to convey our view of future events and trends are
expressly designated as Forward-Looking Statements as are sections of this news
release clearly identified as giving our outlook on future business. The
principal risk factors that may cause actual results to differ materially from
those expressed in the forward-looking statements are described in various
documents we file with the Securities and Exchange Commission, including Form
10-K for the year ended December 31, 2004 and Form 10-Q for the most recent
quarter.
These forward-looking statements are subject to significant risks, assumptions
and uncertainties, including, among other things, the following important
factors that could affect the actual outcome of future events:
Relating to the ongoing operations of the combined companies:
o General economic conditions, either nationally or in our market area,
that are worse than expected;
o regulatory and legislative actions or decisions that adversely affect
our business plans or operations;
o price competition;
o inflation and changes in the interest rate environment;
o the performance of financial markets and/or changes in the securities
markets that adversely affect the fair value of our investments or
operations;
o changes in laws or government regulations affecting medical
professional liability insurance and practice management and financial
services;
o changes to our ratings assigned by A.M. Best;
o the effect of managed healthcare;
o uncertainties inherent in the estimate of loss and loss adjustment
expense reserves and reinsurance; and changes in the availability,
cost, quality, or collectibility of reinsurance;
o significantly increased competition among insurance providers and
related pricing weaknesses in some markets;
o changes in accounting policies and practices, as may be adopted by our
regulatory agencies and the Financial Accounting Standards Board; and
o changes in our organization, compensation and benefit plans.
Relating to the proposed transaction with ProAssurance:
o The business of NCRIC and ProAssurance may not be combined
successfully, or such combination may take longer to accomplish than
expected;
o the cost savings from the merger may not be fully realized or may take
longer to realize than expected;
o operating costs, customer loss and business disruption following the
merger, including adverse effects on relationships with employees, may
be greater than expected; and
o restrictions on our ability to achieve continued growth through
expansion into other states or through acquisitions or business
combinations.
We wish to caution readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made, and wish to
advise readers that the factors listed above could affect our financial
performance and could cause actual results for future periods to differ
materially from any opinions or statements expressed with respect to periods in
any current statements. We do not undertake and specifically decline any
obligation to publicly release the result of any revisions that may be made to
any forward-looking statements to reflect events or circumstances after the date
of such statements or to reflect the occurrence of anticipated or unanticipated
events.
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August 2, 2005